Before Writing an Offer

There are many costs that homebuyers incur,
especially upon purchasing your first home. Some of the expenses related to
buying a home are one-time costs, while others are continuing costs.

Your largest outlay is the down payment. As
a first time buyer, this would likely represent only 5 - 10% of the purchase
price. Be prepared to pay for additional costs, such as:

Legal Fees & Disbursements

GST and PST (if applicable)

Land Transfer Tax

Property taxes and adjustments (reimbursed
to the vendor)

Interest on interim financing, if any

Utility Payments

Strata or Condominium Fees

Estoppel certificate fee

Survey Fee

Home Inspection Fee

Water quality and quantity certificate

Appraisal Fee

Mortgage broker's fee (if applicable)

Mortgage Loan Insurance Premium (if less
than 20% down)

Mortgage Loan Insurance Application Fee (if
less than 20% down)

Moving Expenses

Renovations and repairs

Furniture, paint, carpeting, window
coverings, etc.

Service and Utility Hook-up Fees

Property/Condominium Insurance

Mortgage Application Fee

Deed and/or Mortgage Registration Fee

Additionally, once you have purchased your
home, you will incur regular expenses on a monthly, quarterly or yearly basis.
Some of these costs include:

Mortgage Payment

Water and/or Sewer Payments

Electricity and Gas Services

Cable, Telephone and Internet Services

Property Taxes

Strata or Condo Fees

Repair/Maintenance Expenses

Homeowner's Insurance

How to Make an Offer

When you have found a home you are
interested in buying, your RE/MAX Sales Associate will walk you through the
process of drafting an offer to purchase. Your sales associate will communicate
the offer to the seller or the seller's real estate agent for you. Some
properties are in demand and you will not be the only interested party making
an offer. Your RE/MAX Sales Associate will assist you in generating an offer
that is reasonable and protects your interests using specified terms and
conditions.

An offer can be drafted with or without
conditions; an offer without conditions is known as a firm offer and one with
conditions is known as a conditional offer. A conditional offer represents the
party with the placement of certain conditions on the purchase. Some of these
conditions could be "subject to financing approval", "subject to
the strata council allowing pets", "subject to the buyer's house
selling", "subject to an approved home inspection", among many
others.

The seller may accept your initial offer,
reject your offer or present a counter-offer. The counter-offer may differ from
your original offer in respect to price, conditions, the closing date or any
other items. Offers can be countered back and forth between the parties until
one of you accepts or rejects, ending the negotiations.

There are many components of an offer that
you should be aware of and understand. Your RE/MAX Sales Associate will answer
your questions and explain the entire process to you so that you are
comfortable with the steps involved.

Terms

An offer includes certain
"terms", which specify the total price offered and how the financing
will be arranged, such as if you will arrange your own with a financial
institution or mortgage broker or if you wish to take over the seller's
mortgage (assumability).

Inclusions and Exclusions

These are specifications within the offer
that detail the items to be included or excluded from the purchase of the
property. Typical inclusions are appliances, window coverings, fixtures and
decorative pieces.

Deposit

A deposit is provided from the buyer to the
seller as a token of the buyer's assurance and intention to buy the property
involved. The deposit is applied against the purchase price of the home once
the sale has closed. Your RE/MAX Sales Associate can assist you in proposing a
certain and appropriate amount for the deposit.

Conditions

Items that are usually put in place to
protect a party's interests upon selling or buying the property and refer to
things that must occur or be in place before the sale closes.

Closing Date

This is usually the date that the legal
ownership of the property transfers from the seller to the buyer and, unless
otherwise noted, when the funds for the purchase are concluded.

Possession Date

When the buyer takes possession as
specified in contract oif purchase sale.

Purchase Price

This is the amount that the buyer is
offering to pay for the property. The price is usually dependent on market
conditions and may differ from the seller's current asking price.

Legal Needs

Purchasing a home involves a lot of
paperwork, most of which are contractual documents that will legally bind you
to the numerous terms and conditions. For this reason it is important to have a
good lawyer or notary public acting for you. Someone to protect your rights and
interests.

Finding a Lawyer/Notary Public

If you don't have a lawyer or notary
public, you can look for a referral from friends, family or business
acquaintances. Look for someone with real estate experience and discuss their
fee scales. Your RE/MAX Sales Associate can help you locate a reliable
professional, whom you feel comfortable working with.

Lawyer's/Notary Public's Function

You will need a lawyer or notary public to
process your purchase and ensure the terms are met:

the correct property is purchased

transfered title to your name

ensureed title is free and clear of prior
owners encumbrances

your mortgage is registered properly on
title

The legal process varies from province to
province within Canada. Specifically, you will need to consult with your chosen
legal professional and he/she will explain the process and the steps that need
to be completed before you get the keys to your new home.

Your lawyer/notary public will prepare a
"Statement of Adjustments" outlining all the financial aspects of
your sale.

Legal Fees and Disbursements

The difference between legal fees and
disbursements is analogous to the parts and labour you pay when fixing your
car. Your RE/MAX Sales Associate can help you locate a reliable professional,
whom you feel comfortable working with.

Home
Inspection

A home inspection is an objective visual
examination of a home's structure and systems.

Why get a home inspection?

There are a number of reasons why RE/MAX
recommends a home inspection including:

To ensure you are not surprised by major
defects

So you can be advised about the various
elements of the home including - heating and cooling systems, structure,
electrical and plumbing

To learn about how the mechanical systems
work and need to be maintained

Most homeowners are not expert in the
numerous components of house construction

A third party can be objective as there is
no emotional attachment

Who should you hire?

Home inspectors are often referred by
family or friends. Your RE/MAX agent can also provide you with a list of
inspectors. Look for one that is trained and certified by a national
organization such as Canadian Association of Home Inspectors (CAHI) or National
Institute of Building Inspectors (NIBI) and who has errors and omissions
insurance. Do not hire someone who will do any suggested work due to the
conflict of interest.

When should you call?

Order the inspection after your offer has
been accepted. The contact will stipulate the length of time you have to complete
the inspection.

What is involved?

The home inspection will determine the
structural and mechanical soundness of the home. Your home inspector can
identify existing and potential problem areas, suggest possible solutions and
provide estimates for the cost of the work required. You will receive a report
outlining the inspection findings. You should accompany the home inspector
during the inspection or arrange to meet them at the home so they can walk you
through the report. If as a result of the inspection, you have further
concerns, have a specialist in that area conduct a more extensive examination.

What does it cost?

Costs vary depending on a number of factors
including:

Size and location of the home, features,
age, and services required. Additional services may include radon, septic and
well testing. Your RE/MAX agent can assist you in obtaining a quote from a
potential inspector before you enlist his/her services.

Mortgage Information

Mortgage lending is a highly competitive
field. Information on mortgage rates, which can change daily, is available in
local newspapers, through mortgage brokers, from individual lenders and of
course through conventional financial institutions. When you are shopping for a
loan, interest rates tell just part of the story. You will also need to study
the various fees lenders charge and many mortgages today are almost
custom-tailored to individual needs with many options available.

Ask your Agent

Your RE/MAX real estate professional can
recommend lenders to check with prior to beginning any serious house hunting so
you will know exactly what you can afford.

For further information, please contact a
mortgage broker in your area or TD Canada Trust at
http://www.tdcanadatrust.com/